A. Outlook on global oil supply and demand
In the November 2011 issue of the “Oil Market Report”, IEA forecasted that global oil demand will be roughly 89.2 million b/d, a year-on-year rise of around 900 thousand b/d, in 2011 and that it will be approximately 90.5 million b/d, a year-on-year increase of 1.3 million b/d, in 2012.
Forecasted global oil demand was decreased 70 thousand b/d (Year 2011) and 20 thousand b/d (Year 2012) from the previous month’s forecasts owing to increased uncertainty over the global economy and continued high oil prices.
Non-OPEC supply and OPEC NGL supply are forecast to be around 52.8 million b/d and 5.9 million b/d (a year-on-year rise of 100 thousand b/d and 600 thousand b/d), respectively, in 2011 and around 53.8 million b/d and 6.3 million b/d, respectively, in 2012.
Demand for OPEC oil is forecast to be around 30.5 million to 30.6 million b/d.
Notes: Asia* refers to Asian developing countries excluding China; e refers to forecasts.
Source: IEA, Oil Market Report, November issue.
Outlook on the international energy market
1
(Unit: Million b/d)
Category 2011
2010 2012e
1/4 2/4 3/4 4/4 averageAnnual 1/4 2/4 3/4 4/4 averageAnnual
OECD 46.2 46.3 44.5 45.9 46.4 45.8 46.1 44.4 45.6 46.0 45.5
North America 23.8 23.8 23.3 23.5 23.5 23.5 23.5 23.1 23.5 23.5 23.4
Europe 14.6 14.2 14.1 14.7 14.6 14.4 14.0 13.9 14.6 14.5 14.3
Asia Pacific 7.8 8.3 7.1 7.7 8.3 7.9 8.6 7.4 7.5 8.1 7.9
Non OECD 42.1 42.6 43.4 43.7 43.8 43.4 44.1 45.0 45.3 45.3 44.9
China 9.1 9.5 9.5 9.3 9.8 9.5 9.9 10.1 9.9 10.2 10.0
Asia* 10.4 10.7 10.8 10.5 10.9 10.7 11.0 11.1 10.8 11.2 11.0
World 88.3 88.9 87.9 89.6 90.2 89.2 90.2 89.4 90.9 91.4 90.5
<TableⅢ-1> IEA’s global oil consumptions and forecasts
B. International oil price outlook
Major international organizations forecast that oil prices will record a year-on-year rise of 35.9% to reach $106.03 (Dubai oil) per barrel in 2011, and a year-on-year drop of 1.4% to stand at $104.50 per barrel in 2012.
Most organizations forecast that the average oil price in 2012 will drop from the 2011 level. However, EIA expects WTI’s average oil price to slightly go up and post $98.00 per barrel in 2012.
- EIA’s outlook on oil prices was raised in consideration of political turmoil in oil- producing countries in the Middle East and North Africa. However, risks that would lead to a decline in oil demand exist, such as a slowdown in global economic recovery and the European financial crisis.
Notes: CGES: Center for Global Energy Studies (London) CERA: Cambridge Energy Research Associates EIA: US Energy Information Administration PIRA: PIRA Energy Group
C. Outlook on the international natural gas market
International natural gas demand is forecast to record a year-on-year rise of 5.1% in 2012
(Unit: $/Bbl)
Category 2011
2010 2012e
1/4 2/4 3/4 4/4 averageAnnual 1/4 2/4 3/4 4/4 averageAnnual CGES Brent(D) 79.90 106.00 118.00 114.40 109.00 111.90 104.40 98.30 92.00 - 96.40 Dubai 78.03 100.48 110.71 107.09 105.86 106.03 103.98 104.63 103.95 105.44 104.50 CERA Brent(D) 79.46 104.96 117.35 113.45 109.03 111.20 107.25 107.63 108.00 108.38 107.81 WTI 79.38 93.97 102.43 89.70 91.20 94.32 87.25 85.63 84.00 88.38 86.31 EIA WTI 79.40 93.50 102.22 89.72 93.82 94.82 98.00 98.00 98.00 98.00 98.00 PIRA Brent 79.45 104.95 117.35 113.45 109.60 111.35 109.35 107.85 106.65 112.40 109.05 WTI 79.40 93.95 102.45 89.70 94.25 95.10 101.10 103.70 103.00 107.35 103.80
<TableⅢ-2> Oil price outlook by major overseas organizations in September
to reach 3,555.2 billion m3as a result of efforts made by countries all across the globe to cut down CO2emissions and a rise in LNG demand in Asia.
A rise in natural gas consumption is expected in tandem with efforts made by governments throughout Europe to cut down CO2 emissions and the movement to replace nuclear power generation with natural gas. However, the possibility of an increase in prices triggered by reduced supply and the economic downturn in the euro zone will likely limit a rise in consumption.
Japan made known its intention to make spot purchase of LNG. The country is expected to substantially increase natural gas consumption in 2012 to replace the damaged nuclear power plants. China and Korea are also expected to witness a considerable rise in natural gas consumption.
Notes: 1) Values in parentheses indicate the year-on-year growth rate (%); e refers to forecasts.
2) Australasia: A region of Oceania comprising Australia, New Zealand, the island of New Guinea, and neighboring islands in the Pacific Ocean.
Source: EIU, World commodity forecasts: Industrial raw materials, January 2012
(Unit: Billion m3)
Category 2011e 2012e
North America 855.3 888.7
(3.3) (3.9)
East Europe / 674.2 698.0
Commonwealth of Independent States (3.6) (3.5)
West Europe 573.5 581.0
(-2.5) (1.3)
Asia/Australasia 639.1 712.2
(11.8) (11.4)
Middle East 386.2 410.1
(5.5) (6.2)
Latin America 140.5 146.8
(4.0) (4.5)
Africa 113.4 118.4
(4.3) (4.4)
Worldwide 3,382.2 3,555.2
(4.1) (5.1)
<TableⅢ-3> International natural gas consumption and outlook
In 2012, international natural gas production is forecast to stand at 3,530 billion m3, a year-on-year rise of 4.6%, attributable to increased production of natural gas in North America, the Middle East, and Africa.
Most of the natural gas produced in the Middle East will be from South Pars in Qatar and North Dome in Iran. Russia plans to increase production by developing Yamal, which holds Russia’s biggest natural gas reserves.
The US plans to increase natural gas production and reduce imports while substantially increasing exports to Korea, Japan, India, Brazil, and other countries.
Russia’s Sakhalin, Indonesia’s Tangguh, and Yemen are emerging as new natural gas exporting areas. Australia is also expanding facilities to increase exports.
Notes: 1) Values in parentheses indicate the year-on-year growth rate (%); e refers to forecasts.
2) Australasia: A region of Oceania comprising Australia, New Zealand, the island of New Guinea, and neighboring islands in the Pacific Ocean.
Source: EIU, World commodity forecasts: Industrial raw materials, January 2012.
(Unit: Billion m3)
Category 2011e 2012e
North America 871.1 910.3
(5.4) (4.5)
East Europe / 844.8 882.8
Commonwealth of Independent States (4.1) (4.5)
West Europe 291.5 293.4
(-4.5) (0.7)
Asia/Australasia 489.5 515.5
(4.7) (5.3)
Middle East 504.2 530.4
(9.5) (5.2)
Africa 219.0 230.4
(3.2) (5.2)
Latin America 156.2 167.3
(5.0) (7.1)
Worldwide 3,376.2 3,530.0
(4.5) (4.6)
<TableⅢ-4> International natural gas production and outlook
In 2012, the LNG price in Japan is forecast to record US$ 16.7/mBtu in the first quarter and then slightly go down. However, the annual average price will likely go up to US$
15.98/mBtu, a year-on-year increase of 8.8%, owing to demand that is increasing at a faster pace than production.
The natural gas price (Henry hub) in the US, which is relatively less influenced by international circumstances, is forecast to continually rise in 2012 and reach US$
4.63/mBtu, an annual increase of 11.0%.
The natural gas price in Europe in 2012 is forecast to reach US$ 10.64/mBtu, a 2.2% rise from the previous year. It will be placed under pressure to go up by strong natural gas demand in Asia.
Notes: 1) Values in parentheses indicate the year-on-year growth rate (%); e refers to forecasts.
2) The natural gas price in the US is based on the Henry hub. The price in Europe (excluding the UK) is the import border price. The price in Japan is the LNG import price.
Source: EIU, World commodity forecasts: Industrial raw materials, January 2012
(Unit: US $/mBtu)
Category 2011 2012e
Annual 1/4 2/4 3/4 4/4 Annual
US 4.17 4.30 4.45 4.65 5.10 4.63
(-5.0) (2.9) (1.8) (12.9) (27.5) (11.0)
Europe 10.41 10.70 10.45 10.65 10.75 10.64
(25.6) (13.2) (1.4) (-2.1) (-2.3) (2.2)
Japan 14.68 16.70 16.00 15.50 15.70 15.98
(35.3) (39.3) (16.7) (-5.3) (-5.7) (8.8)
<TableⅢ-5> Outlook on international natural gas prices
Notes: The natural gas price in the US is based on the Henry hub. The price in Europe (excluding the UK) is the import border price. The price in Japan is the LNG import price.
Source: EIU, World commodity forecasts: Industrial raw materials, January 2012
D. Outlook on the international coal market
Coal demand in China and India, which recently led a rise in global coal demand, is expected to continually go up in 2012.
Coal demand in China and India is expected to record continued high growth of around 6% and 8%, respectively, attributable to economic growth and the resulting power generation demand.
Coal demand is forecast to remain at the current level in the US and European countries as a result of strengthened environmental regulations. Demand for coal-based power generation in Germany and Japan is forecast to slightly go up, influenced by Japan’s nuclear energy crisis.
Australia is planning the adoption of the carbon tax in July 2012, but its effect on coal demand is forecast to be limited.
[FigureⅢ-1] Outlook on international natural gas prices
Notes: Values in parentheses refer to the rate of increase from the previous year; e refers to forecasts.
Source: EIU, World commodity forecasts: Industrial raw materials, January 2012.
Coal demand is expected to somewhat slow down in 2012. Accordingly, the rate of increase in coal production will likely slow down by a small margin.
Coal production will likely indicate year-on-year growth of between 4% and 5%.
China and Indonesia will lead increased production in 2012 and are expected to account for more than 53% of global coal production.
(Unit: Million ton)
Category 2010 2011e 2012e
China 3,387 3,658 3,896
(7.5) (8.0) (6.5)
US 951 937 904
(4.7) (-1.5) (-3.5)
EU 718 754 746
(-0.1) (5.0) (-1.1)
India 689 748 810
(10.8) (8.6) (8.3)
Russia 206 209 213
(2.0) (1.5) (1.9)
Japan 188 186 193
(13.9) (-1.1) (3.8)
Global total 7,289 7,681 7,995
(6.0) (5.4) (4.1)
<TableⅢ-6> Outlook on global coal consumption
Notes: Values in parentheses refer to the year-on-year growth rate; e refers to forecasts.
Source: EIU, World commodity forecasts: Industrial raw materials, January 2012
International coal prices are expected to slightly decline in 2012 as a result of the global economic downturn. However, they will likely remain high.
Notes: 1) Values in parentheses refer to year-on-year growth.
2) Coal prices are those of Australian thermal coal.
Source: EIU, World commodity forecasts: Industrial raw materials, January 2012.
(Unit: Million ton)
Category 2010 2011e 2012e
China 3,321 3,687 3,945
(8.9) (11.0) (7.0)
US 985 980 950
(1.2) (-0.5) (-3.1)
India 569 557 574
(2.5) (-2.1) (3.1)
Australia 407 415 432
(2.0) (2.0) (4.1)
Russia 311 322 335
(4.7) (3.5) (4.0)
Indonesia 359 398 426
(18.9) (10.9) (7.0)
Global total 7,401 7,861 8,207
(6.2) (6.2) (4.4)
<TableⅢ-7> Outlook on global coal production
(Unit: US $/ton)
Category 1/4 2/4 3/4 4/4 Annual
2010 95.19 99.49 93.55 107.63 98.97
(32.3) (49.7) (31.2) (38.6) (37.8)
2011 128.99 120.00 120.61 115.00 121.15
(35.5) (20.6) (28.9) (6.8) (22.4)
2012 110 107 105 105 106.75
(-14.7) (-10.8) (-12.9) (-8.7) (-11.9)
<TableⅢ-8> Trends in international coal prices and outlook
